THE young apprentice loved to boast of his romantic conquests over the weekend. His workmates nicknamed him "Romeo", in the true Australian larrikin tradition.

But "Romeo" took offence to their ribbing. He lodged a discrimination claim on the grounds of "lawful sexual activity". His employer, a small auto-electrician company in rural Victoria, chose to pay thousands of dollars in compensation in a confidential settlement, to avoid the costs of fighting the claim in court.

"Employers are being held to ransom by claims of discriminatory conduct by employees," says Victorian Automobile Chamber of Commerce industrial manager Bill Chesterman, who helped negotiate the "go away" payment.

New discrimination laws planned by the Federal Fovernment will extend the workplace warfare to every facet of public life. Australians' behaviour and conversations in schools, shops, playgrounds, clubs, pubs and sporting fields will be covered by the anti-discrimination legislation drafted by Attorney-General Nicola Roxon. Hurt feelings are set to become the legal trigger for compensation claims.

The government's attempt to modernise Australia's anti-discrimination laws attracted a hornet's nest of criticism this week from churches, employers, unions and civil libertarians.

Catholic Cardinal George Pell and the shop assistants' union - unlikely allies - both decried the draft laws as "the first step towards totalitarianism".

Employer groups predict the changes will result not in a lawyers' picnic, but a lawyers' lunch - long-running and very expensive. State governments are complaining the federal laws will interfere with their power to arrest criminals, suspend driving licences or ban the mentally ill from owning guns.

Catholic hospitals fear a challenge to their bans on abortion and birth control, while a Melbourne academic claims transgender men will start taking over the women's loos.

The Senate Legal and Constitutional Affairs Committee has been swamped with more than 600 submissions during its ongoing inquiry into the draft Human Rights and Anti-Discrimination Bill. The new legislation combines and updates five existing sets of federal discrimination laws covering race, sex, age and disability.

Discrimination on the grounds of gender identity or sexual orientation will be outlawed for the first time, delivering Labor's 2010 election promise. This change prompted University of Melbourne social sciences professor Sheila Jeffreys to complain that transgender people will access women-only housing, toilets and prisons.

"Under the right to gender identity, male-bodied persons, in many cases with penises intact, are likely to be permitted to enter women's toilets," she says in a submission to the Senate inquiry. "There are quite a surprising number of cases in which men wearing women's clothing have been arrested for ... secret photographing of women using the toilets and showers, peeping at women from adjacent stalls ... (and) luring children into women's toilets in order to assault them."

A much broader concern is that the definition of discrimination has been widened to include "conduct that offends and insults", in a change widely criticised as a threat to free speech.

ABC chairman and former NSW Supreme Court chief justice James Spigelman declared in his Human Rights Day oration last month that "the freedom to offend is an integral component of freedom of speech. There is no right not to be offended".

Even the president of the Australian Human Rights Commission, Gillian Triggs, has called on the government to change the wording.

"The fact that someone may say something which offends or upsets another person is not a sufficiently valid reason to curtail their freedom of expression," his submission states.

"To provide that someone who merely offends is guilty of an offence opens the door to ... the jailng of anyone who voices a view on any controversial matter."

Queensland Council of Civil Liberties president Michael Cope fears the legislation could limit public debate to "innocuous, sterilised conversation".

"The council is not a racist organisation but we defend a person's right to express racist sentiments," he told the inquiry. "Being democratically elected does not give a government a mandate to stifle voices with which it does not agree. If a person is physically or emotionally abused, the issue is not racist expression, but instead a problem with violence or aggression which should not be tolerated".

Cardinal Pell agrees it is "one step towards totalitarianism".

"Discrimination is a regular and necessary part of daily life," he wrote in News Ltd papers on Sunday. "We discriminate between friends and foes. Society discriminates between criminals and the law-abiding ... (and) by choosing only the best students to study medicine or law and the best athletes to represent Australia. Governments choose which immigrants they will accept and those they expel."

The contentious terms "offend" and "insult" have been plucked from the existing Racial Discrimination Act, which was used to prosecute Herald-Sun columnist Andrew Bolt in 2011 over his article questioning grants to "fair-skinned Aborigines".

Under the new laws, the wording would apply for the first time to all 17 "protected attributes" that range from age and sex to political opinion, religion and breastfeeding.

In theory, any of the nursing mothers offended by Seven Sunrise host David Koch's call for "classy" breastfeeding could lodge a discrimination suit.

Unlawful discrimination in employment has also been widened, to include industrial history, religion, political opinion, social origin, nationality or citizenship, and medical history.

And discrimination on the grounds of age, sex, race, disability, pregnancy and potential pregnancy, marital or relationship status, immigrant status, gender identity, sexual orientation, and breastfeeding will be banned outside the workplace as well.

Discrimination will become illegal in all areas of public life, defined in the legislation as workplaces, schools, accommodation, clubs and "access to public places".

Constitutional law professors Nicholas Aroney, of the University of Queensland, and Sydney University's Patrick Parkinson, have told the Senate inquiry the "heavy-handed" laws blur the line between illegal discrimination and social rudeness.

"A bully in a school playground, a rude customer who pushes in front of someone waiting in a queue at a takeaway restaurant, an inconsiderate employee who gossips about another employee, and a spectator who abuses a referee at a children's soccer game ... may be considered unlawful if the behaviour can plausibly be related to a protected attribute," they stated.

"This extends the reach of the law very far into areas of community life which have hitherto been regulated largely by other norms ... by school disciplinary responses, by a public rebuke to the rude customer, by a quiet word by a manager of the gossiping employee, or through criticism of the angry spectator by others at the game."

Critics are also alarmed that the burden of proof will be reversed, so that people accused of discrimination will have to prove their innocence. And each party will have to pay their own legal costs, regardless of who wins - although a judge may still opt to award costs to one party on the grounds of "justice".

Those accused of discrimination must prove that they were exempt from the law, or else "engaged in the conduct, in good faith, to achieve a legitimate aim".

The explanatory memorandum of the legislation says this will cover situations such as denying a driver's licence to a blind person, or banning men from a swimming pool "to recognise religious and cultural reasons prohibiting some females from bathing in front of men".

Denying someone a job or promotion is not discriminatory if the person "cannot meet the inherent requirements of the job".

Other defences will be "fair commentary on matters of public interest", as well as "artistic performances, fair and accurate reporting of events or matters of public interest", and statements made for any genuine academic, artistic or scientific purpose.

The Human Rights Commission will have stronger powers to dismiss complaints, and complainants will need permission to go to court.

The Attorney-General's Department has told the Senate inquiry that "resentful ex-employees and repeat nuisance claims seeking `go-away' money" are likely to be dismissed as vexatious, frivolous or insubstantial complaints.

"Double dipping" has been banned; those who lodge a complaint under state and territory laws or the Fair Work Act can't claim under the federal law as well.

The government's Regulation Impact Statement, prepared for the draft legislation, notes that defendants are already spending more than $100,000 defending complex cases.

It admits that shifting the burden of proof to the respondent "could increase the number of complaints".

Religious organisations have been given limited exemptions, so they can continue to legally discriminate against women, gay people or employees who oppose their beliefs. But aged care services that receive federal funding will no longer be able to discriminate against gay residents.

Volunteers will be protected for the first time, so that work experience students and tuckshop mums will be able to lodge complaints and seek damages payouts.

David Goodwin, a member of the Australian Chamber of Commerce and Industry's productivity committee, describes the law as "manna from heaven for no-win, no-fee law firms. Bosses are going to have to become the thought police," he says. "It's unworkable".

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